Rio Tinto Ltd. had agreed to pay C$578 million ($567 million) to acquire Canadian uranium company Hathor Exploration Ltd., dislodging an earlier higher bid by rival Cameco Corp. of Canada.

Rio Tinto's offer is now placed at $C4.15 per share, 11 per cent higher than Cameco's bid of $C3.75 a share made in late August. The board of directors of Hathor Exploration Ltd. had reportedly recommended the offer to its shareholders and urged them to accept the Rio Tinto offer.

However, a number of analysts had said Cameco may still rival Rio Tinto's offer, stalling the bidding process to a longer time, according to the Business Spectator.

"The acquisition of Hathor bolsters Rio Tinto's global uranium strategy and complements its current exploration programmes in Saskatchewan and its uranium operations elsewhere in the world," Rio Tinto said in a statement.

Energy Resources of Australia Ltd., Rio Tinto's Australian uranium unit, has been encountering declining output of the raw material in nuclear fuel due to lower grades and bad weather. It is located at its Ranger mine in the Northern Territory.

Rio Tinto and Cameco are vying Hathor's uranium-rich Athabasca Basin of Saskatchewan, which produces about 20 per cent of the world's uranium.

Uranium is used fuel nuclear power plants. Prices of uranium had been struggling to recover since the nuclear crisis hit Japan last March that led countries to re-evaluate their nuclear power programs.